AbbVie to Buy Shire for $54.8 Billion

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July 18 (Bloomberg) -- AbbVie Inc. agreed to buy Shire Plc for about 32 billion pounds ($54.8 billion), becoming the latest U.S. health-care company to shift its tax residence abroad in a record surge in industry deals. Caroline Hyde reports on “The Pulse.” (Source: Bloomberg)

The deal seems to be done.

32 billion pounds worth of the takeover deal.

52.48, that is what the shareholders of shire, a drug company.

Rare diseases is what they focus on.

They will get 52.48 pounds per share in cash and stocks.

If you are a shire shareholder, you will own 25% of an entire company with $137 billion of sales.

This is going to be a huge drugs company.

The whole reason this is so advantageous to abbvie is that they will be able to have a 13% corporate tax rate.

That is being sliced, reducing this.

They will move their legal address to the united kingdom rather than the united states.

Their management are not moving.

Most of the company will be run out of america.

They are run out of north chicago.

But it will be domiciled in the u.k. most offiesces for shire are in basingstoke.

The fact that they wilderness against what seems to be a push coming from jack lew.

He's desperately trying to undo the attraction of moving your headquarters abroad.

He has been talking about that because some people have been wondering how long it will take the u.s. to close this loophole that is making the tax evasion looking so attractive to u.s. companies.

Some of said that congress needs to do something.

Others say that there needs to be a bigger overhaul of tax legislation.

You end up with this not moving anywhere.

It is interesting.

Of course, we had jack lew lew come out saying i want to propose a law that makes it far less attractive to move your tax rate to the u.k. to escape u.s. tax rates.

I'll back date it to may.

That is when the astrazeneca-pfizer deal broke.

Why u.s. companies want to move out of the united states because their corporate tax rate is in excess of 30%. if you move to the u.k., you can cut it to 13%. astrazeneca's deal unraveled.

This is one of those deals that manages to harness that.

That is not seem to be a brake clause.

At the moment, abbvie is saying a breakup fee would be cap that $500 million.

They are banking on the republicans will not allow jack lew to update the loss in less they push through a wider tax overhaul.

It is a clear case of a company trying to moving out of the u.s., cutting the tax rate, and seemingly the board are willing to recommend the deal.

It is fair and reasonable and $32 billion is where it should be.

Today is the deadline by 5:00 p.m. let's head to berlin chancellor merkel is speaking

This text has been automatically generated. It may not be 100% accurate.


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